Risk response budget allocation based on fault tree analysis and optimization

Budget allocation in project risk response is a vital issue management since it relates to reasonable utilization of strict budgets and effective mitigations the risks that typify projects. This paper presents an integrated method based on optimization model fault tree analysis for allocating budget from preventive protective perspective. The proposed consists three main steps. first step analyse calculate probabilities losses which involves identifying causes may trigger event occur using analysis. It also identifies consequences once occurs, evaluates occurrence expected financial consequences. second build relationship between allocated strategies corresponding effects. third construct aiming at minimizing total cost. We present proofs optimal strategy special cases model. Furthermore, detailed computational experiment performed gain insights into three-phased more general cases. results show can be determined structure network has significant impact preferred strategy.